TORONTO - The Toronto stock market was in negative territory Tuesday near midday as commodity prices gave back some of their recent enthusiastic gains, while U.S. investors waited to see if the Federal Reserve might take new actions to stimulate the economy. The S&P/TSX composite index slipped 59.60 points to 12,174.91, while the TSX Venture Exchange lost 2.72 points to 1,683.56. Gold stocks were a drag, down 1.4 per cent, as the December bullion contract pulled back $3.80 from a record close to US$1,277 an ounce in New York. Oil prices also ticked lower, sending the energy index down 0.5 per cent. Benchmark crude for October delivery was down $1.36 to $73.50 a barrel. The Toronto market is heavily weighted in both oil and gold, which means that price shifts can have a noticeable impact on the overall direction of the index. "It's probably nothing more than a pause at this point," said Larry Berman, chief investment officer at ETF Capital Management. "I do think we're going to get maybe one more pullback over the next few weeks but markets look to be OK heading into the end of the year." The TSX information technology sector was ahead 0.3 per cent with Research In Motion (TSX:RIM) gaining traction after photos emerged online of a rumoured new Storm 3 smartphone. RIM stock lifted $1.20 to $47.58. Economic data on both sides of the border offered at least some reason for traders to be optimistic. The Canadian dollar was down 0.13 of a cent to 97.02 cents US after a report from Statistics Canada that inflation started to track lower again in August after a big jump in July caused by the introduction of the HST in Ontario and British Columbia. Inflation edged down one-tenth of a point to 1.7 per cent in August, as prices on a monthly basis fell 0.1 percentage points from July. Core inflation, which the Bank of Canada uses to gauge price pressures in the country, was flat at 1.6 per cent, well below the central bank's two per cent target. In the United States, uncertainty over the upcoming Federal Reserve announcement has put a big September rally on hold before the central bank's meeting wraps up Tuesday afternoon. The Dow Jones industrial average lifted two points to 10,756. The Nasdaq composite index slid two points at 2,354, while the S&P 500 was down a point to 1,142. Investors want to see if the Fed will announce, or at least hint at, plans to start buying Treasurys and mortgage bonds again to help spark the sluggish economy. Stocks jumped to four-month highs Monday as buying accelerated after the Standard & Poor's 500 index broke out of its recent trading range, adding confidence to a month-long rally. If the Fed were to announce immediate action or paint a grim picture about the health of the U.S. economy, stocks could retreat because new pessimism from the central bank could undermine the enthusiasm that drove the recent run-up. U.S. construction of new homes jumped 11 per cent last month, rising above economist predictions that had looked for growth of less than one per cent. The big jump fits into a pattern of recent economic reports topping modest forecasts, which has been enough to lift stocks sharply higher throughout the month. In corporate developments, Dynetek Industries Ltd. (TSX:DNK) shares popped 15 per cent after it announced a joint venture with India-based S.V. Energy that it said would maximize its penetration in the Indian market for lightweight, compressed natural gas fuel storage cylinders and systems. Shares were up four cents to 30 cents. Crescent Point Energy Corp. (TSX:CPG) announced late Monday that it would acquire exploratory properties in southern Alberta and Saskatchewan and also increased its production guidance for 2010 on Monday. Shares were off 59 cents to $36.80. Overseas, Britain's FTSE 100 rose 0.07 per cent, Germany's DAX index rose 0.3 per cent, and France's CAC-40 gained 0.3 per cent. Japan's Nikkei stock average fell 0.3 per cent.

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